KCB Group has signed up to the Pan-African Payment and Settlement System (PAPSS) to enhance cross-border trade and financial integration across the continent. As the first bank in East Africa to integrate PAPSS into its systems, KCB customers will enjoy faster settlement times, reduced costs associated with currency conversion, and increased access to new markets across Africa.
PAPSS is a centralised financial market Infrastructure developed by the African ExportImport Bank (Afreximbank) to facilitate cross-border payments and trade transactions, reducing both costs and processing times.
Notably, the system’s net settlement mechanism will help alleviate pressure on the demand for foreign currencies, supporting a more efficient and sustainable regional trade framework. The platform puts KCB at the forefront of facilitating trade across Africa as it continues to play a pivotal role in driving Africa’s economic transformation and reinforcing its position as a leading financial institution in the continent.
“We want to play a bigger role in catalysing trade and payments in Africa and beyond, leveraging our digital capabilities and regional footprint,” KCB Group CEO, Mr Paul Russo, said. “Our entry into PAPSS aligns perfectly with our strategy of supporting economic growth in Kenya and across Africa by facilitating seamless financial transactions.”
> Why Abu Dhabi is Becoming Popular For Kenyan Property Investors
KCB group has a presence in seven East African countries and Mr Russo said its customers now have access to vast economic opportunities that will deliver multiple advantages and efficiencies especially when conducting intra-African trade payments.
PAPSS CEO, Mr Mike Ogbalu the onboarding into PAPSS showcases KCB Group’s commitment to enhancing financial connectivity and supporting the implementation of the AfCFTA. “With PAPSS, KCB customers will experience unprecedented ease in cross-border transactions, paving the way for enhanced trade opportunities and economic growth across the continent,” said Mr Ogbalu.
Mr. Michael Eganza Central Bank of Kenya Director, Banking & Payment Services said the banking regulator is keen to enable financial players to bolster the payments ecosystem for an opportunity to enable cross-border transactions. “We are increasingly looking at reinvigorating the regulatory regime to promote innovation and deepen financial inclusion within the industry,” said Mr Eganza.
PAPSS will deliver multiple advantages and efficiencies to intra-African trade payments that include a reduction in the duration and time variability of cross-border payments across Africa, support real-time payments and decrease the liquidity requirements of commercial banks for cross-border payments. It will also remove transaction value limits, enable commercial banks to set the applicable exchange rates and strengthen oversight of cross-border payment systems by Central Banks.
“With intra-Africa trade currently at 14%, there is an opportunity for players within the ecosystem to progressively evaluate the opportunities that can be harnessed to support with PAPSS leading the way on this,” said Lee Kinyanjui, Cabinet Secretary Ministry of Investments, Trade & Industry. The Pan-African Payment and Settlement System (PAPSS) is expanding, now including 15 Central Banks, over 150 commercial banks, and 14 switches across Eastern, Western, Northern, and Southern Africa. I
> Kenya’s Taxman Pins a Country’s Hope on Technology
Leave a comment